Look Out The Window

Quick, look out the window. It's raining. No, the sun's out. No, it's cloudy. Wait a second, it is changing again, but I can't tell what it is going to do.

Kinds like the stock market. Up one day, down the next, then goes sideways. That stock I bought is not acting right. Maybe I should sell it, but I'll wait another day. My broker (the weatherman) says it will go back up.

At the beginning of every year we hear stock market forecast (whether we want to or not) and every one of the "experts" is about as accurate as our TV weatherman. Be sure to take your umbrella. Every year the Wall Street Journal surveys more than 50 economists and every year about 1/3rd of them are right. A weatherman can do better than that. The analysis of these birds seems impeccable and when you hear them speak so confidently you are sure they are right. He must be right ? he's a broker/economist/financial planner and they know everything. Well, at least a lot more than I do ? maybe.

Having owned a brokerage company and hired about 300 brokers I can assure you they don't know any more than you do. It just sounds that way. The one question you should always ask any broker before you give him your money is if he had a winning year last year. The market was down overall about 25%. If he lost more than 5% you don't want to know him. And if he says he made a bundle you had better question him carefully and ask for proof.

For the last 3 years almost everyone lost money. But this year it will be different. My broker said so. Only once before did it ever go down 4 years in a row and the odds of it's happening again are astronomical. Now that's logic for you. If you want to know what the weather is you look out the window. This same logic goes for the stock market. It is going down except for brief periods. As long as the major trend continues it would be wise NOT to buy anything.

Now that President Bush has given us his "stimulus" package and the Democrats have countered with theirs I wonder how long they are going to fight over how much and who gets what. It could be months before we see anything definitive from Washington. And that means you and I won't be getting any relief until then.

Tell those guys in the Beltway that it's raining and we need an umbrella ? NOW!

Al Thomas

Author of "If It Doesn't Go Up, Don't Buy It!"

Never lose money in the stock market again.

http://www.mutualfundmagic.com

---

Mid-Cap Stocks: Asset Class with an Identity Crisis

Much like the middle child, mid-cap stocks have long struggled... Read More

Discipline

One of the great "secrets" of successful people is discipline... Read More

Smart Day Trading Strategies to Help You Make Money in the Stock Market

Stock trading can be a very profitable activity. You can... Read More

Online Investing & Online Stock & Share Trading: Difficulty in Taking Stop Losses in the Market

This is an extract of an article which was first... Read More

Who Knows?

The Shadow knows. Remember him? It seems a shadow has... Read More

No Load Mutual Funds: Boost Your Portfolios Returns

Investors who exclusively use broadly diversified, no load mutual funds... Read More

A Funny Thing Happened on the Way to the Stock Market

On the 40 year journey through the turmoil of a... Read More

How Eating Bitumen Made Me a Better Trader

Trading is a fascinating activity.There are so many layers to... Read More

The Secret Method to Selecting a Winning Trading System

Every successful trader has a winning system. There are of... Read More

Choosing a Stock Broker

If you were to find that you had some severe... Read More

The Stock Market is a Roller Coaster: Prepare for the Ups and Downs

IT'S REMINISCENT OF THE OLD children's tale about an old... Read More

Investing in Trash Company Stocks

Refuse is a serious issue in any society, about as... Read More

Its Better

Question: How does it get better when it gets worse?Last... Read More

Why Investors Use Financial Planners

Do you have a financial planner? Does one of your... Read More

3 Components Needed for Beating the Market

Time to look back2004 is over, now we are in... Read More

Basics of Stock Market

Financial markets provide their participants with the most favorable conditions... Read More

Getting Even

I know there are a lot of you out there... Read More

Selling

The stock market has been going up for more than... Read More

Municipal Bonds

Because there are so many stocks that are NOT paying... Read More

Forecasting the Stock Market

Every day I see in the financial section of newspapers... Read More

The Stock Market - Part 1: Believe It Or Not, Its Always Been Your Best Friend And Always Will Be

Regardless of the fact that the world's stock markets have... Read More

The Information Age

It is wonderful to be alive in the information age.... Read More

Analyzing Growth Stocks: An Important Focus For Any Investor

Analyzing growth stocks is an important focus for any investor.... Read More

The Big Bad Bear

The big bad bear is stirring again. So far he... Read More

9 Deadly Trading Mistakes!

The following are a list of nine things you want... Read More

Direction

It is difficult to make money in a bull market,... Read More

Hedge Funds: the Good, the Bad, and the Ugly

Alfred Winslow Jones started hedge funds in 1949. He was... Read More

Tips to Finding Other People?s Simple Trading Plans

Did you know you can make money (and a lot... Read More

Economists

In today's volatile and confusing stock markets everyone is searching... Read More

Financial Crime

Congress recently passed another new law that is supposed to... Read More

Price Targets

Every day in any financial publication you will find the... Read More

A Stock Market Investment Strategy

I feel that an investment strategy in the stock market... Read More

Low Tide

When you stand on the ocean shore and watch the... Read More